First-time dental practice buyers face an important decision around the time they’re closing on their practice: do I use the seller’s accountant or find a new one?
I recommend buyers get a new accountant for the tax and bookkeeping work you’ll need help with as an owner.
Here are four reasons why:
1. You want your own representation on the tax aspects of the practice purchase.
There are a few key tax-related issues with real dollars at stake when a business changes hands. If one accountant is handling both sides of the transaction, there are no checks and balances to ensure you as the buyer have your interests taken into consideration.
Just like when dealing with a broker on the practice sale, the same principle applies to accountants when two parties’ interests are at stake – dual representation is the same as no representation!
2. Your new business entity starts with fresh numbers.
No financial information from the seller’s business transfers to your new business. Unlike patient charts or billing information in your practice management software, your financials are totally separate. A new accountant will be starting at the same place the seller’s old accountant starts.
3. A fresh set of eyes can be extremely valuable.
The seller’s accountant has likely been doing the bookkeeping and tax returns for the practice you’re buying for years. They’ve probably seen the same numbers year in and year out. Bringing in a new accountant brings a fresh set of eyes and perspective to these numbers and can often uncover savings opportunities the seller and her accountant hadn’t considered. Of course, this assumes your new accountant is dental-specific, which should go without saying.
4. Repricing services from time to time is healthy.
Just like when you’re buying a dental practice and looking to potentially upgrade equipment and find ways to serve your patients more effectively, repricing accounting services from time to time can reveal that there are faster, cheaper and better ways to get your bookkeeping and tax returns done. New software can make exchanging information with your accountant easier. New reports can show you how your business compares to other dentists and where you could be saving money. And costs can creep up with the seller’s accountant who has had the account locked down for years.
Could the seller’s accountant be the best option for your new practice? Sure! But more often than not, I see the buyers finding better, faster and cheaper options for the same services the seller was getting.
Shop around and let me know what you find!
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